Correlation Between Calvert Large and Astonherndon Large

Can any of the company-specific risk be diversified away by investing in both Calvert Large and Astonherndon Large at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Calvert Large and Astonherndon Large into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Calvert Large Cap and Astonherndon Large Cap, you can compare the effects of market volatilities on Calvert Large and Astonherndon Large and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Calvert Large with a short position of Astonherndon Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert Large and Astonherndon Large.

Diversification Opportunities for Calvert Large and Astonherndon Large

0.72

Correlation Coefficient

Calvert Large  Astonherndon Large

Poor diversification

The 3 months correlation between Calvert and Astonherndon is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Calvert Large Cap and Astonherndon Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astonherndon Large Cap and Calvert Large is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Calvert Large Cap are associated (or correlated) with Astonherndon Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astonherndon Large Cap has no effect on the direction of Calvert Large i.e., Calvert Large and Astonherndon Large go up and down completely randomly.

Pair Corralation between Calvert Large and Astonherndon Large

Assuming the 90 days horizon Calvert Large is expected to generate 4.55 times less return on investment than Astonherndon Large. But when comparing it to its historical volatility, Calvert Large Cap is 9.87 times less risky than Astonherndon Large. It trades about 0.19 of its potential returns per unit of risk. Astonherndon Large Cap is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  1,306  in Astonherndon Large Cap on September 11, 2025 and sell it today you would earn a total of  42.00  from holding Astonherndon Large Cap or generate 3.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Calvert Large Cap  vs.  Astonherndon Large Cap

Calvert Large Cap

Risk-Adjusted Performance

Good

Over the last 90 days Calvert Large Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and fundamental indicators, Calvert Large is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Astonherndon Large Cap

Risk-Adjusted Performance

Fair

Over the last 90 days Astonherndon Large Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward indicators, Astonherndon Large is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Calvert Large and Astonherndon Large

The main advantage of trading using opposite Calvert Large and Astonherndon Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert Large position performs unexpectedly, Astonherndon Large can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Astonherndon Large will offset losses from the drop in Astonherndon Large's long position.

The idea behind Calvert Large Cap and Astonherndon Large Cap pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.